Airbus CEO Optimistic Despite Engine Supply Challenges as Year-End Delivery Goals Loom

Faury expresses cautious confidence in overcoming supply constraints to meet Airbus’s 2024 jet delivery targets.

Navigating Supply Chain Turbulence

Airbus CEO Guillaume Faury shared a cautiously optimistic outlook on Tuesday regarding engine supplies, a critical factor influencing the company’s jet delivery pace. Speaking at an industry event in Brussels, Faury acknowledged the challenges posed by global supply chain issues but expressed growing confidence that CFM International, a primary engine supplier, would deliver enough units to support Airbus’s end-of-year targets. However, he warned that the situation would remain “very tight” through November.

CFM International—a joint venture between GE Aerospace and Safran—is the world’s largest engine manufacturer by unit sales and a vital supplier for Airbus’s popular A320neo narrowbody aircraft. Ongoing supply constraints from CFM have significantly impacted Airbus’s production schedule, prompting the aerospace giant to revise its 2024 delivery target in July from 800 jets to “around” 770. To achieve this, Airbus now faces the daunting task of delivering approximately 200 aircraft in the last two months of the year.

Cautious Optimism Amid Industry Struggles

When asked about the likelihood of meeting year-end targets, Faury indicated that any shortfall in engine supply would likely involve only a few units rather than a substantial number. While his recent comments reflect a more positive stance compared to earlier in the year, the CEO acknowledged that the situation is not without risk.

Industry insiders attribute this shift in tone to intense negotiations over engine allocations, which appear to have yielded some progress. Faury also pointed to additional challenges, such as disruptions caused by recent U.S. hurricanes, which compounded the existing industrial hurdles faced by CFM.

“CFM has done reasonably well under the circumstances,” Faury said, adopting a more conciliatory tone compared to the frustration expressed earlier in the summer.

A Balancing Act for Engine Manufacturers

CFM, currently celebrating its 50th anniversary, plays a pivotal role as one of two engine suppliers for Airbus’s A320neo family and holds exclusive rights to supply engines for Boeing’s 737 MAX. Balancing the production of new engines with servicing demands for existing aircraft has proven challenging for the manufacturer, particularly amid supply chain disruptions from key suppliers.

This bottleneck led to tensions between Airbus and CFM over the summer, with supply challenges cited as a primary reason for Airbus’s revised delivery target. In addition to engine shortages, Airbus has faced difficulties sourcing other components, such as landing gear and aircraft seats.

Pressure to Deliver

As of the end of October, Airbus had delivered 62 jets, bringing its 10-month total to 559. While this leaves the company on track for another strong year, some analysts remain skeptical about Airbus’s ability to hit its target of 770 jets. Supply chain uncertainties and potential bottlenecks in November could still necessitate a further adjustment to guidance.

Despite these hurdles, Airbus maintains some flexibility in its delivery target wording, allowing it to count as few as 750 deliveries without issuing an official revision.

Racing Against the Clock

Airbus’s performance continues to outpace that of its primary competitor, Boeing, which is still recovering from its own production setbacks. However, with just weeks remaining in the year, timely delivery of engines and other critical components will be essential for Airbus to sustain its momentum and meet its goals.

The stakes are high as the European aerospace giant pushes for another year-end surge in output. Faury’s guarded optimism signals progress, but as industry analysts caution, unexpected challenges could still arise. For now, all eyes remain on Airbus and its supply chain as the company races to close out 2024 on a high note.